There are people who adore Panama City, and there are people who use Panama City as a tolerated pit stop before sprinting to more far-flung destinations. In our eight days there, I learned an important distinction — those who tolerated Panama City stay downtown. Those who can’t get enough of Panama City stayed in Casco Viejo.

The downtown skyscrapers make for a beautiful skyline, but they lack old world charm — an asset the Casco, as locals call it, is overflowing with. Old world indeed — Casco Viejo was Panama City back in 1904, when the US broke ground on the Panama Canal. As time went on, the city expanded, and the Casco was abandoned in favor of what is now downtown Panama City. As a local tour guide explained to me, just fifteen years ago guidebooks only mentioned Casco Viejo in order to warn tourists not to step foot there — it had deteriorated into a dangerous, dilapidated slum.

But then somewhere in the past decade, things started to shift — the area earned UNESCO World Heritage Status, and a whirlwind of artists, visionaries, and all around It People started swirling through those colonial streets. Today, Casco Viejo is the Williamsburg to downtown Panama City’s Times Square. While the rough edges, thankfully, have yet to be smoothed out entirely, the Casco is ground zero for Panama City’s boutique hotels, hip eateries and happening nightlife.

The Casco is small; just three avenues wide. Addresses are hardly necessary, though when we check into our self-described boutique arts hostel, the receptionist pulls out a map and draws a large map over the area north of Calle 11. “Don’t go there,” she cheerfully explained. The Casco still has its edge — literally.

After our disaster in basing ourselves in Quito’s Old Town, I had been wary of booking our entire eight night stay within Casco Viejo. By the time Anders dragged me out of the city, I was ready to start apartment hunting.

While visitors draw comparisons between Panama City and Havana, New Orleans and Miami, the Central American city has a flavor all its own. From the rooftop of our hostel, we watched the world go by as the sun went down — literally. Lumbering container ships from around the world hovered hear the Pacific entrance to the Canal in one direction, while the glittering skyscrapers of the downtown’s global financial center lit up in the other. Down at street level on the Casco, we passed alternating universes — renovated luxury condos squeezed in between abandoned colonial mansions, the doors swung wide open to reveal families of squatters settled comfortable into chaos.

Panama City was the first destination in Latin America that made me stop and think, I could live here — though unfortunately I’ve got luxuriously renovated apartment taste on a squatter’s budget. But boy, was it fun to pretend for a while. I skipped all over that city, daydreaming about turning our hip restaurant-hopping into a routine, and making arty boutique-browsing a regular part of my leisurely expatriate schedule.

I don’t think I could ever live anywhere that didn’t feel vibrantly alive after the sun goes down — luckily, the Casco has nightlife covered. On the weekend we arrived, the city was pulsing with energy from thee annual Jazz Festival. One night, we sipped cerveza at hidden-away expat favorite Mojito Sin Mojito. Another, we mingled at Tantalo’s rooftop bar — arguably the city’s hippest — while watching the unusual scene below. In the Casco, we learned, there’s no such thing as valet parking. Instead, locals known as buen cuidados come tapping on the windows of the Range Rover SUV’s cruising through their neighborhood and guide the cars into parking spots, and watch over them while them owners play.

At the climax of our nightlife research, we spent a whole night dancing under the stars until the sun threatened to show itself over the horizon. Where one person might see a gutted old convent with nothing left but four crumbling walls, another sees a pop-up nightclub. So beats the heart of the Casco’s bohemian nightlife scene.

Of course not everything was perfect. Prices were high compared to the countries we’d spent the last few months traipsing through — often, I looked at my receipts and realize they revealed similar figures to what I might pay at home, though the value of what I was getting was undeniably higher.

Luckily, our favorite Panama City activity, getting lost with a camera in hand, was completely free (unless you wandered by Granclement ice cream by accident, and then it was $2.75 for a scoop.) My favorite photography subject? The street art hangover left by Casco’s vibrant arts scene.

I found another free activity to combat the ice cream addiction: jogging at sunset. The Cinta Costera boasts prime people watching, perfect for distraction from a body begging for the exercise torture to just stop already — the waterfront was bustling with families enjoying a pre-dinner stroll, fitness buffs getting in a final workout of the day, friends gossiping on their way home from work, and a rare few tourists snapping away at the skyline. Running from the Casco towards downtown and then back again was like making a literal jogging route out of Panama City’s historical timeline.

Casco Viejo stole my heart. This is where my own love affair with Panama began, where I first felt the inklings that this country was going to be special. Within days of arriving in Panama City Anders told me how nice it was to hear me laughing again, and I really did feel my step was lighter. Whether it was the sunshine, the salty sea air or something indescribably Panama, it was nice to find myself once again smiling, and in the throes of a wild love affair with an exotic new destination.

Splurged on Nitro City but other than that everything was a good price. Only spent the day in Casco Viejo but next time I get a $320 fare to Panama City I will be spending more time there.Shaun recently posted..Edinburgh – In on a whim out with a bang…literally.

Hm, maybe my idea of the prices was influenced by having arrived straight from Ecuador! And, um, ya know — eating and drinking at all the trendiest (also known as the least budget friendly!) places in Panama City.

That’s really true Breanna 🙂 As I said, Panama City was the first stop on this Latin America trip where I really truly had those “I could live here” thoughts. Normally those are reserved for Southeast Asia!

most people I know who have been (unfortunately I haven’t had a chance to get there yet!) have disliked PC. Good to hear someone loving it!Annie of TravelShus recently posted..Surviving the Souks of Marrakech

I would bet anything that if you asked them, they stayed downtown! Before arriving Anders and I considered splitting our time to be there for half of our stay but when we passed through once or twice we were SO FREAKING GLAD we did not do that. While we did have some fun there (more details in upcoming posts!) it is fairly charmless and it just wasn’t for us. If I was a millionaire I would have left Panama City proud owner of a Casco apartment!

have never had a particular interest in panama & now you’ve got me hooked! colonial architecture, colorful street art & a vibrant nightlife = pretty much my recipe for a top destination. can’t wait to hear more!!

We are planning a trip in August and were between Ecuador and Panama… so its great timing for us that you have recently been to both. It’s making our decision harder! 🙂Katie recently posted..My love letter to Bangkok

When we leave South America we have a one night layover in Panama City…if flights aren’t delayed what would you said are the MUSTs that we should do for our extremely limited time there?Emily recently posted..Our Time Out

Well the no-brainer is to see the Canal! We did a day tour with Barefoot Panama that was great if you have the budget for it, and packs so much into one day (Canal included). At night, I’d head straight to Casco to have dinner and drinks and admire the downtown skyline!

This was so captivating Alex and so beautifully written and photographed, I felt like I was flicking through the pages of a glossy travel mag. Can’t wait to check it out!Sarah Somewhere recently posted..Living Raw: When weakness is strength

Thank you Sarah! And thank you for leaving this comment right now, because you reminded me that I fell asleep last night reading your blog (because I was exhausted, not because it was boring 😉 ) and I meant to return to comment today!

I enjoyed walking along the waterfront and seeing people working out as well. Why don’t local councils at home put in more free workout areas in public spaces?

I was eating pizza outside of the brewery restaurant one night and a couple of gunshots were fired. 3 minutes later a hoard of pokice stormed the building next door and brought out 9 guys handcuffed all in front of us..surreal.Jimmy Dau recently posted..The weeks photos – Black and White

Wow, was that in Casco?! I was amazed at how safe and secure I felt there, though as some locals pointed out to me there was a vested interest in keeping a strong police presence in Panama’s new “it” destination! But of course crime happens anywhere….

I really enjoyed reading this Alex. You really make it sound like a fantastic place and the photos are beautiful. I want to live there now and I’ve never even been!Joella J (J in Beijing) recently posted..Packing for Burma

Certain things about it are “easier,” indeed. They use the US dollar and it’s generally super safe. But the one thing we discovered was the transportation is NOT easy if you’re veering from the Panama City-Boquete-Bocas triad!

I love the architecture and it looks so pretty Alex. I can really see how it has stolen your heart. My heart was left in Prague. It just felt so magical and I felt a kind of calm and peace I haven’t ever felt anywhere else.Jen recently posted..London: 60 Things to See and Do (Part 2)

Yes, yes, yes. Although it’s more of a little village than a city. New Zealand grabbed my heart and Picton, at the top of the south island then squeezed it tightly. I fell madly in love with the place. I totally connect with where you’re coming from. 🙂Janice Stringer recently posted..Making The Decision To Travel By Public Transport in Switzerland

P.S. Happy to share my walking tour with anyone interested. (You can message me from Trip Advisor). BTW: We just passed a new milestone. I used to say we have ~30 places to dine/drink (that’s tapas bars, gelato-/ice cream shops, cafes, bistros, restaurants, the micro-brewery, enotecas, fondas, coffeehouses etc.). Well, now there are over 40!! …and more on the way.

Oh it’s gorgeous! When we stayed in Panama City we were stuck with downtown because ALL the rooms were taken in Casco Viejo. We spent a day wandering around the neighbourhood and loved it. When we go back, I’ll make sure we book well in advance 🙂Rebecca recently posted..Bali sunsets

I’ve basically gone through your blog in one night! I’m loving all of the central and southern american posts!

I was wondering what your take on panama’s affordability compared to other countries in central america? We’ve looked into and became obsessed with costa rica [the beaches, eco tourism, and funky vibe] but I just don’t think I can swing those prices all day every day.

We are thinking of a small beach area in a funky and upcoming neighborhood. And probably in a few years. I’m totally starting to flirt with Peru and Panama after going through your blog though. Your photos made me fall in love- thank you 🙂caroline recently posted..7 things we learned from owning a home

I’m glad you found me Caroline — and thanks for the kudos 🙂 Panama is definitely much more affordable than Costa Rica. From what I understand, Belize and Costa Rica are the most expensive countries in Central America, with Panama coming in third. However I found that Panama was a great value — we paid more than we might have in other countries but what we got for our money was fantastic! I can’t recommend it more highly.

Thanks for the post and beautiful pictures. We are leaving tonight for Panama City. I booked us one night in Casco Viejo before we head out to Bocas del Toro. I will definitely have to check out that ice-cream place!

Your site is sexy and your shots are even better! The first placed I ever stayed was Lunas Castle in Cascso in 2011. I went back for the second time last year for almost 3 months and got to see some crazy ish!! Check it out here if you want

I’m going on an 9 day trip to panama city next week 😀 and really want to stay at the panamericana hostel. Do you have the phone number for it? I have a sad feeling it might have closed :/ I also love your idea of splitting the trip up into two different hotels!

I'm a New York native who left my home to explore the world slowly and thoroughly. I’m just a little obsessed with photography, scuba diving, and reading guidebooks to countries I have no immediate plans to visit.